New Delhi: Billionaire Mukesh Ambani’s Reliance Industries Limited has taken over the operations of at least 200 stores of Future Sources said on Saturday that the Kishor Biyani-led group has offered jobs to retail and its employees after the Kishor Biyani-led group failed to make lease payments to the landlords.
Reliance Retail, the retail arm of the oil-to-telecom conglomerate, had agreed to take over Future Group’s retail and logistics business in August 2020 for Rs 24,713 crore, but the deal could not be closed as Future’s warring partner . heroine Some went to courts citing breach of contracts. Future denies any wrongdoing.
Sources said that several landlords had approached Reliance as Future Retail Ltd.FRL), which is in loss, was unable to pay the rent.
Future has over 1,700 outlets, including popular Big Bazaar stories, and has not made lease payments for some of its outlets. Facing closure, Reliance transferred leases of some stores to its step-subsidiary company, RRVL and sublet them to Future to operate the store, the sources said.
Since then it has started rebranding the shops and offered to take all the employees working there on its payroll, he said.
In addition, most of the goods at these stores were being supplied by Reliance Jiomart Due to cash crunch, FRL could not clear the dues to the existing suppliers. Reliance can replace the signage and branding of Big Bazaar with its own brand from these stores.
Amazon has argued that Future violated the terms of the 2019 deal, when the US e-commerce giant invested USD 200 million in a Future Group unit. Amazon’s position is supported by a Singaporean intermediary.
Without confirming or denying the acquisition of its stores, Future Retail Ltd. in a stock exchange filing said, “Shareholders are aware that FRL is passing through a serious financial crisis. The company has defaulted on its debt servicing and as has been previously Only informed, the account is classified as NPA by the company’s banks.”
FRL said meeting the working capital requirements is becoming increasingly difficult and “due to large dues, termination notices have been received for a large number of stores, and we will no longer have access to such store premises.”
“The ongoing litigation initiated by Amazon in October 2020, and which has continued for the past year and a half, has created serious impediments in the implementation of the plan (Reliance acquisition), resulting in a serious adverse impact on the functioning of the company. Having said that the firm is scaling down its operations to reduce losses.
FRL is proposing to expand its online and home delivery business to increase its reach to the customers.
“The company is finding it difficult to meet its working capital requirements. Incurring losses at the store level is a serious concern and is a vicious cycle where larger operations are leading to more losses,” the filing said. The company has incurred a loss of Rs 4,445 crore in the last four quarters.
FRL said it expects the Reliance deal to be implemented as it will be beneficial to all stakeholders. When contacted, Amazon declined to comment on the development.
FRL challenged its lenders in January to the Supreme Court to avoid facing bankruptcy proceedings over missing bank payments, citing its dispute with Amazon.
The Delhi High Court will hear arguments in the dispute between Amazon and Future Group on February 28, 2022.
In August 2020, the loss-making retail giant proposed to sell its retail, wholesale and logistics arms, including fashion businesses at Big Bazaar, Koryo, Foodhall and EasyDay, to Reliance for Rs 24,713 crore.
FRL missed the due date of repayment of Rs 3,494.56 crore to its lenders as on December 31, 2021. The retail venture blamed the delay on an ongoing dispute with Amazon. But he had sought to repay the loan in the next 30 days i.e. by January 2022 – which he too defaulted on.
It then sought to sell off its smaller format stores to pay off the first installment of the debt, but Amazon opposed that move as well. The latter voluntarily helped FRL with a loan of Rs 7,000 crore through Samara Capital, which was denied by the independent directors of FRL.
Giving relief to Kishor Biyani’s FRL, the Supreme Court recently directed bankers and FRLs to find a solution.
The Delhi High Court was also directed by the apex court to hear the matter from Future Group’s point of view as any order would affect the firm’s many Indian employees, bankers and lenders.
Reliance Retail, the retail arm of the oil-to-telecom conglomerate, had agreed to take over Future Group’s retail and logistics business in August 2020 for Rs 24,713 crore, but the deal could not be closed as Future’s warring partner . heroine Some went to courts citing breach of contracts. Future denies any wrongdoing.
Sources said that several landlords had approached Reliance as Future Retail Ltd.FRL), which is in loss, was unable to pay the rent.
Future has over 1,700 outlets, including popular Big Bazaar stories, and has not made lease payments for some of its outlets. Facing closure, Reliance transferred leases of some stores to its step-subsidiary company, RRVL and sublet them to Future to operate the store, the sources said.
Since then it has started rebranding the shops and offered to take all the employees working there on its payroll, he said.
In addition, most of the goods at these stores were being supplied by Reliance Jiomart Due to cash crunch, FRL could not clear the dues to the existing suppliers. Reliance can replace the signage and branding of Big Bazaar with its own brand from these stores.
Amazon has argued that Future violated the terms of the 2019 deal, when the US e-commerce giant invested USD 200 million in a Future Group unit. Amazon’s position is supported by a Singaporean intermediary.
Without confirming or denying the acquisition of its stores, Future Retail Ltd. in a stock exchange filing said, “Shareholders are aware that FRL is passing through a serious financial crisis. The company has defaulted on its debt servicing and as has been previously Only informed, the account is classified as NPA by the company’s banks.”
FRL said meeting the working capital requirements is becoming increasingly difficult and “due to large dues, termination notices have been received for a large number of stores, and we will no longer have access to such store premises.”
“The ongoing litigation initiated by Amazon in October 2020, and which has continued for the past year and a half, has created serious impediments in the implementation of the plan (Reliance acquisition), resulting in a serious adverse impact on the functioning of the company. Having said that the firm is scaling down its operations to reduce losses.
FRL is proposing to expand its online and home delivery business to increase its reach to the customers.
“The company is finding it difficult to meet its working capital requirements. Incurring losses at the store level is a serious concern and is a vicious cycle where larger operations are leading to more losses,” the filing said. The company has incurred a loss of Rs 4,445 crore in the last four quarters.
FRL said it expects the Reliance deal to be implemented as it will be beneficial to all stakeholders. When contacted, Amazon declined to comment on the development.
FRL challenged its lenders in January to the Supreme Court to avoid facing bankruptcy proceedings over missing bank payments, citing its dispute with Amazon.
The Delhi High Court will hear arguments in the dispute between Amazon and Future Group on February 28, 2022.
In August 2020, the loss-making retail giant proposed to sell its retail, wholesale and logistics arms, including fashion businesses at Big Bazaar, Koryo, Foodhall and EasyDay, to Reliance for Rs 24,713 crore.
FRL missed the due date of repayment of Rs 3,494.56 crore to its lenders as on December 31, 2021. The retail venture blamed the delay on an ongoing dispute with Amazon. But he had sought to repay the loan in the next 30 days i.e. by January 2022 – which he too defaulted on.
It then sought to sell off its smaller format stores to pay off the first installment of the debt, but Amazon opposed that move as well. The latter voluntarily helped FRL with a loan of Rs 7,000 crore through Samara Capital, which was denied by the independent directors of FRL.
Giving relief to Kishor Biyani’s FRL, the Supreme Court recently directed bankers and FRLs to find a solution.
The Delhi High Court was also directed by the apex court to hear the matter from Future Group’s point of view as any order would affect the firm’s many Indian employees, bankers and lenders.
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